Five Ways to Save Rhode Island
Saturday, January 28, 2012
Rhode Island officials will have to move fast if they want to keep the Ocean State afloat, accordin to business and thought leaders.
From top executives down to the small business owner, the message was clear: adopt new policies and change attitudes at the State House or Rhode Island will lag behind.
Some business owners are fed up with the state injecting dollars into bringing new companies into the state while existing ones are struggling to survive.
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“A lot of people like myself are treading water to stay in business,” said Al Drew of Al Drew’s Music Center. Drew, who had three stores in Rhode Island but was forced to shut down two, is not happy with the state’s effort to bring new business to Rhode Island.
“They threw millions of dollars at Curt Schilling to bring his company here,” he said. “If you have millions to spend, why not divvy it up among the businesses that are already here. Help us to say solvent and be more profitable.”
GoLocalProv breaks down the five ways Rhode Island can be saved, straight from the experts.
1) Targeted Tax Breaks
Issues facing small businesses are heard loud and clear at the State House, according to House Minority Leader Brian C. Newberry.
“I’ve been a strong opponent of targeted tax breaks or attempts by the government to pick which industries will be winners and losers,” Newberry said. “If you want to have an attractive economy you need to make the economic climate attractive to all businesses as a whole.”
Drew, who has been in business for 45 years, said there are many things that need to be corrected by officials including tax breaks, workman’s compensation and issues with commercial real estate.
“The biggest problem is Rhode Island is always willing to give tax breaks to those willing to bring business in; how about helping us to stay in business,” he said.
The small business owner who operates only his Woonsocket store after shutting down this stores in Warwick and Pawtucket, said he cannot afford to hire many people because of workman’s compensation insurance. Drew said the rates are just too high and you can only buy workers’ compensation from one company.
Beacon Mutual Insurance, one of the largest workers’ comp insurers in Rhode Island, said it will give struggling businesses a break in the second quarter 2012. The company will issue a 3% dividend payment to its 11,400 policy it said in a recent release.
2) Changing Regulations and Attitudes
“When you talk to business people the first complaint is not just the taxes, but the hoops you have to jump through in order to do business in Rhode Island,” Newberry said. “Rhode Island is not perceived as a place for new business or a place where businesses want to expand.
“Obviously there has to be something in our environment that is causing us to lag behind when it comes to private sector job creation.”
Rhode Island faces tough competition from its neighbors because Massachusetts provides a variety of incentive programs, grants and loans, workforce development initiatives and public/private initiatives, according to Greater Providence Chamber of Commerce President, Laurie White.
“The competition for jobs and investment is very strong and it’s just 10 miles up the highway,” she said. “Rhode Island has very few dollars to leverage that same investment.
3) Cultivate, Replace and Recruit
There are three main things that the state needs to do in order to move forward, according to White.
“You have to cultivate what you have, replace what you are losing and absolutely must recruit from outside of the state,” White said. “You need to do all three at the same time and all three are equally important to do together.”
White said she has seen a remarkable shift in attitude over the last few years adding that the, “General Assembly really gets it.”
“They understand it’s about jobs and putting people back to work and that we need to bear down hard on what is holding us back,” she said.
What exactly may hold the state back in the coming year?
4) A Major Gamble
One is the issue of table games at Twin Rivers and Newport Gran Jai alai. Revenue from video lottery, 60 cents from every dollar puts hundreds of millions into the state’s coffers.
“With Massachusetts now having three licenses, it really threatens Rhode Island,” White said. “The business community is very concerned about this issue because it’s several hundreds of million dollars in revenue at stake. If we see erosion of that, it will have negative implications in tax rates.
In fact, White referred to a report that shows $100 million already being siphoned out of Rhode Island by nearby casinos.
“If Massachusetts goes to a full casino, Twin Rivers and Newport Grand will need to keep up with table games.”
5) Expansion a Must
Another issue is the expansion of T.F. Green Airport, which has the shortest runway of any medium-sized airport in the country. The state desperately needs the runway upgrades and improvements, according to White.
“This airport improvement project must get underway,” White said. “This is an economic generator and the economic engine of growth.”
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EDITOR' NOTE - An earlier version misspelled jai alai - we apologize for the error and thank a reader for pointing out the error.
